25 Ways To Grow & Scale Your Digital Marketing Agency In 2024: Why Profit Margins Are The Key To Expansion

November 24, 2023

In 2024, ways to grow and scale your digital marketing agency include: 

  • Build rank and rent websites to generate a secondary income for your agency.
  • Leverage the 20/30/50 rule for your marketing company.
  • Use AI and automation strategies for your digital firm.
  • Share social proof like reviews and testimonials from your existing marketing clients.
  • List your digital business in online directory sites.

LocalIQ says "that the average small business spends 5%-10% of its total revenue on digital marketing". A firm that knows how to get attention from the right people on the Internet. Or, an agency that can develop a marketing strategy to achieve more leads, sales, and revenue for a potential customer can secure a steady stream of high-paying clients to grow and scale their business. The key is to be a company that specializes in a few specific services like email marketing or paid advertising. Become an authority in that niche. As a result, you can negotiate higher prices, make more money with fewer clients, and grow your marketing firm. 

But to scale your digital marketing agency, you need to keep overhead costs low. Next, provide relevant but profitable services like SEO or content creation that yield recurring client revenue. Then, develop a team of industry experts who know how to get real results for your clients. In 2024, the average profit margin for a digital marketing agency should be about 40%. OMG Center reports that "the top performing digital advertising agencies generate a 40%-60% profit margin while start-ups and underperforming agencies only see 20%-30% agency margins".

However, a marketing company needs to stay current on industry trends to make high profit margins. As a result, they'll have the monetary resources they need to expand. In this article, we list 25 ways to grow and scale your digital marketing agency in 2024. We also share why your profit margins are the key to achieving long-term growth goals for your digital marketing agency.

25 Ways to Grow & Scale a Digital Marketing Agency In 2024

1. Develop Secondary Revenue With Rank And Rent Websites For Your Marketing Company

To scale a digital marketing agency, build and rank lead generation websites that get to the top of the SERPs. The rank and rent business model is a proven concept that can get more leads for a potential client. Hexospark states that "61% of marketers say that digital traffic and lead generation are their number one challenges".

Rank and rent is easy. Create generic websites in one location and offer one service. Get your website to the top of the Google search engine, and it's in front of people searching for your service. Each lead gen site generates leads that you own. You can sell your leads to local business owners. Then, your firm can secure a secondary income stream.

2. Leverage The 20/30/50 Rule For Your Digital Marketing Agency

The 20/30/50 rule is a financial compass to help agency owners better manage their gross profit margin. The goal is to achieve a 20%+ net margin by:

  • Use 50% of your budget for overhead and non-negotiable expenditures like rent, employee salaries, and a necessary digital marketing tool.
  • Spend under 30% of your income on wants that aren't needed to maintain a creative agency profitability, such as updated software or advanced automation technology.
  • The remaining 20% is earmarked for future goals and investment opportunities like building digital assets such as a lead generation website that produces leads you can sell to secure a secondary income stream.

By leveraging the 20/30/50 rule, an agency can simplify its budget and know how much profit it earns monthly.

3. Be A Hyper-Specialized Agency To Negotiate Higher Prices For Your Digital Marketing Company

Choose the niche or customer base you want to help—for example, corporate advertising agencies. Next, focus on one service and one specific offer, like running paid ads or specializing in social media marketing campaigns. Then, become a recognized industry expert.

Provide personalized attention to your client. Viral Web suggests that "high-growth enterprises achieve 20% more growth year over year than the competition by adopting a niche marketing approach". Offer a turnkey, results-driven solution. As a result, you can command higher ticket prices.

4. Develop A Distinct Value Proposition For Your Agency

A unique value proposition can distinguish an ad agency from the competition. It highlights why small businesses should hire your digital marketing agency. The key to developing a unique value proposition is to:

  • Identify your client base and their main pain point
  • Illustrate the benefits of your services and how these benefits can solve their problem
  • Define what you do, how your approach is unique, and why they need your agency

Show them how they can make more money by retaining your services. Focus on value. Price is only a problem in the absence of value. Know your customer and your product. How does your agency compare to the competition? What are the wants and needs of your ideal audience? Be specific. Then, make the customer your priority. 

5. Rank For Digital Marketing Agency Longtail Keywords

To scale and grow your digital firm rank for longtail keywords in the SERPs. Longtail are specific search queries that often have low search volume. But they're easier to rank and focus on a target audience. My Codeless Website shares data that suggests "keywords with 10-15 words in length get 2.62Xs more clicks than one-word keyword terms". Other advantages of longtail keywords include:

  • Attract targeted Internet traffic
  • Get higher conversion rates
  • Cost less per click for PPC ad campaigns

Use software like SEMrush's Keyword Magic tool, People Also Ask, or Keywords Everywhere to determine the most relevant longtail keywords. Consider the search intent and be strategic with your marketing effort.

Then, develop topic clusters on your website that make sense to both the reader and the Google bots. Research states that in May 2024, "longtail keywords got 1.76Xs more clickthroughs in the organic searches on Google than a super short keyword phrase".

6. Connect With A Digital Marketing Influencer

Influencer marketing is a way to scale your digital company, get in front of a ton of eyeballs, and reach an audience that might not find your agency elsewhere. Hubspot reports that in 2024, "89% of marketers who collaborate with an influencer will boost or maintain their investment". Influencer marketing is the new word of mouth. 

This social media marketing strategy can increase brand awareness, connect with a broader audience, and build trust with a potential customer base. To find influencers, check out platforms like Grin or Maverck. When deciding on an influencer for your marketing firm, consider:

  • What kind of audience and followers do they have on social media?
  • What social media channels do they use?
  • Do they create content that meshes with the core values of your digital marketing service?
  • What is their level of engagement with their audience?
  • How often do they post?

7. Use AI & Automation Strategies For Your Digital Company

Use artificial intelligence and automation to grow and scale your digital marketing agency. In 2023, AI and automation tactics can save time and streamline tasks for your digital marketing firm. Data shared by Quixy suggests that "marketers that use automation achieve a 77% increase in conversions".

In 2024, an agency should prioritize technology tools like Hootsuite, HubSpot, MailChimp, and ActiveCampaign to handle duties like:

  • Pinpoint high-quality leads
  • Send personalized emails
  • Automate social media posts
  • Compose copy for YouTube and podcast transcripts
  • Track and monitor performance and KPIs
  • Create customer reporting documents for each existing client
  • Provide 24/7 customer support with chatbots

Data states that "51% of companies use marketing automation software". In 2024, AI and automation software can find patterns in user behavior and collect data about what kinds of copy or paid ad campaigns work and where you need to pivot. But it's also a way to stay on top of changes to platform algorithms and share valuable data in real-time.

8. Share Social Proof To Demonstrate Customer Satisfaction With Your Agency

A way to grow and scale your digital marketing agency in 2024 is to share social proof like reviews and testimonials. You can increase the conversions for your digital marketing company and build trust with the right people. The key is to showcase the human side of your firm with in-depth reviews that highlight why you're the best digital marketing agency. Include a name or an image of your client.

Don't just offer a one-liner or picture of a 5-star review on your GPB (Google My Business). Exploding Topic advises that "92% of buyers are reluctant to take action or purchase without online reviews". In 2024, consumers are more apt to invest in a product or service that other people are already using. Further data suggests that "the average Internet user expects to see 112 reviews or more that confirm client satisfaction for a specific product or service".

9. Boost Your Digital Marketing Agency's Web Presence with Online Directories

A way to scale your agency is to list it in online directories. Online directories are sites that let a potential new client research digital marketing agencies before they decide who to hire. By listing your agency website on platforms like HubSpot Partner Directory, Meta Agency Directory, Google Partner Directory, or Clutch, your firm can reach prospects who are ready to buy.

Leveraging an online directory boosts your web presence. It's an influential way to build credibility, gain trust, and stay relevant. An online directory gives your digital company a chance to be found other places online. As a result, you can expand your reach for fewer dollars than paid ads and get attention from the right people.

10. Implement Content Marketing Methods For Your Agency

Content marketing is a way to grow and scale your agency. Using this strategy can help your business reach more people, boost brand awareness, and increase consumer trust. Content Marketing Institute states that "63% of marketers think content marketing helps build loyalty with existing clients". The key to content creation is to learn as much as you can about your target market. Where do they hang out online? What kind of content do they prefer?

What are they looking for on the Internet? Next, provide the best answer to the question a person is asking online. Then, use multiple channels like a blog or website, social media page, or YouTube videos. Be consistent and share value. Track and monitor your content methods to know what works and what doesn't. Research says that "64% of prosperous B2B marketers have a reported content marketing strategy".

11. Adopt Email Marketing To Maintain Your Agency's Client Retention

To grow and scale your agency in 2024, adopt an email marketing strategy. Email marketing is one of the best ways to stay connected with your customers and maintain your agency's client retention. But the key to leveraging this digital marketing strategy is to personalize your email messages. Keep your emails short and simple but value-focused. Data reports that "79% of marketers put email marketing in the top three as the most effective channel for marketing".

12. Provide Personalized Digital Marketing Solutions For Business Owners

A way for a digital marketing agency to grow and scale is to offer personalized solutions for its clientele. Customized solutions include things like:

  1. Custom video creatives on platforms like TikTok, Instagram and Facebook
  2. Hyper-targeted content marketing strategies that speak directly to an identified target market
  3. Advanced technical SEO techniques like meta robot tags and XML sitemaps

Google says that "90% of the top marketers report personalization significantly impacts their firms' profitability". By customizing your service portfolio, you can gain an edge over the competition. Communicate regularly with your customers. Share KPIs and other data. Then, you show your clients that you're invested in the long-term success of their company.

13. Practice A Consumer-Centric Approach To Get Your Agency In Front Of The Right People

An agency owner who wants to scale and grow their business needs to adopt a customer-centric approach and provide a unified experience on multiple channels. The key is to know where your ideal buyer market spends its time online. If they're on Facebook, run a Facebook ad campaign.

Learn what their pain points are and offer the best solution. Post content that speaks the language of your buyer persona in social media management. Next, stay consistent and share valuable information. Blog SoftTek suggests that "agencies that leverage an omnichannel strategy retain 89% of their clients".

14. Partner With Other Digital Marketing Agency Professionals

In 2024, a way to grow and scale your marketing agency is forging a partnership with other digital marketers or an agency that provides services that your firm does not. If your firm is an SEO authority, find an agency that focuses on building websites.

Then, they can refer your services to their clients to help them rank better on Google. Offer an all-in-one solution for your customers. Of course, the arrangement needs to be beneficial for both parties. But this is a low-cost way to grow and scale your agency and provide better service for your clients.

15. Track & Monitor Digital Marketing KPIs & Overdeliver On Value 

To grow and scale your marketing agency, track and monitor KPIs. A KPI is a quantifiable and measurable value that demonstrates how well a business is performing on multiple channels. Knowing how your client's online presence compares to the competition can help evaluate the next steps, create a marketing strategy, and get results. For each marketing campaign, collect information on things like:

  • Conversion rates & churn
  • Website traffic & social media platform engagement
  • Cost-per-lead & ROIs

Use tools like Google Analytics, ahrefs, or HubSpot to get real-time data. Again, the idea is to provide value and exceed your client's expectations. Research confirms that "64% of companies saw a noted growth in sales due to good customer service".

16. Expand Your Digital Marketing Agency Service Options

To scale your digital marketing agency:

  • Offer additional service options like reputation management, search engine optimization, or running Google Ads.
  • Hire or outsource tasks and become a full-service company.
  • Be known for offering comprehensive marketing strategies and efficient solutions.
  • Use multiple channels like social media management, PPC ads, paid media, and websites to showcase your business. 

List the services you offer and highlight the benefits of having one digital firm handle a potential customer's business growth.

17. Leverage Referrals For Your Digital Marketing Firm

To grow your digital firm, get referrals from existing customers. The idea is to exceed customer expectations and overdeliver on value. As a result, you build a reputation as an authority and have satisfied customers. Research states that "for each happy customer, you also get nine referrals."

Develop a referral reward system for your customers. Base your approach so there's an incentive for your clients to suggest your agency to others, like 10% off, a free website audit, or an extra strategy call. Sprout Social shares that "referred buyers have a 37% higher retention rate than other marketing media."

18. Hire The Right People For Your Marketing Company

To grow your marketing company:

  • Outsource for as long as you can. You can find a skilled digital marketer or a credited online marketing expert on sites like Upwork, Freelancer, or Fiverr.
  • Focus on hiring people with experience and testimonials or five-star reviews from past clients that demonstrate their ability.
  • Hire people who compliment your team. If you lack an SEO expert, hire one.

Connect with talented individuals who can work as part of a team and are committed to helping your digital agency achieve growth. 

19. Pay Attention To Your Digital Marketing Pricing

To scale your digital marketing agency, pay attention to your pricing. The idea is to focus on services that generate the highest recurring monthly income. Data from WebFX reveals that the average marketing agency can charge per service based on the following:

  • "SEO costs $350 to $2000 per month".
  • "Running a PPC advertising campaign can cost "$9,000 to $10,000 a month".
  • "Content marketing costs range from $1,000-$20,000/month".
  • Social marketing will cost a business owner $900-$20,000 monthly".
  • Email marketing costs sit between "$300- $2,500 a month".
  • "Custom websites cost $5,000-$15,000 or $300-$1,000 using a template. Ongoing maintenance fees will cost a company $50-$2,000 monthly."

SEMrush suggests that "SEO provides a 2700% ROI, among the highest in digital marketing. Don't focus on selling low-cost or one-time service options. Instead, price competitively enough to keep your clients paying month after month. But high enough that you're making decent profit margins. 

20. Create A Digital Marketing Brand That People Will Remember

To grow your company, create a brand people will remember. The idea is to understand your ideal buyer. What are their values? What kind of copy are they reading? How can your digital agency help them solve a problem? To build brand awareness, you need to offer value beyond your services.

Put yourself in the role of your client. Tell a story that shares content that will serve them. Learn to read the social algorithms and what content gets results. Focus on engagement and offer free advice or run content. Highlight the benefits of working with your company. Then, always look for new channels or opportunities to reinvest and grow your brand, like starting a podcast or repurposing blog content on YouTube or Facebook.

21. Increase Your Digital Marketing Agency’s Revenue Channels

A way to grow your digital company is to increase its revenue channels by adopting a recurring service like SEO or social media marketing. Hence, your client continues to pay you a monthly fee. Other methods to yield secondary streams of revenue include: 

  • Create digital assets like rank and rent websites that produce leads your agency can sell to a business owner for profit margins as high as 85%-90%. 
  • Implement referral programs and loyalty benefits. Sign Post suggests that "65% of new clients come from referrals". Further data suggests that "referred clients can increase your profit margin by 25%".
  • Sell digital products like an eBook or downloadable PDF cheat sheet on how to drive more traffic to an offer.
  • Leverage affiliate marketing. Authority Hacker states that "20% of brand marketers express that affiliate marketing is their most prosperous channel".

22. Keep Costs Less Than The Lifetime Value Of A Customer

To grow your firm, keep your expenses lower than the LVC. Data Feed shares that "the standard benchmark for a good CAC should be between 1/3-1/4 of a customer's LTV". For example, if a client spends $1,000/month on digital marketing services for 5 months, it should cost your agency less than $1,250 to land them as a paying customer.

Of course, the method you choose also factors how much it costs to acquire a client. Paid ads are expensive and only work when you pay to run them. But there are less costly ways to retain new buyers that include things like:

  • Retarget and prioritize the right audience
  • Engage with customers on social media or other channels
  • Run A/B tests on landing pages, website, and sales funnels
  • Create UGC and drive organic traffic to your offers

The key is to use multiple channels and test each method. See what works and where you need to tweak or pivot to keep client acquisition costs as low as possible. 

23. Streamline Your Digital Marketing Systems

To scale your marketing business in 2024, streamline your systems: 

  1. Develop distinct goals around content creation, campaigns, and new client acquisitions
  2. Document your process with checklists, templates, etc.
  3. Track your data and KPIs
  4. Converge tools to reduce the tech and keep things simple but efficient

The idea is to create a digital marketing blueprint that includes specific strategies on how to generate more revenue streams for the lowest costs. The more efficient your agency runs, the fewer expenses you incur. Then you have the money to hire new staff, leverage paid ads to get more clients, or buy new technology.  

24. Overdeliver On Value 

To grow your business, deliver results. The key is to exceed customer expectations. Then, your company will retain clients and get more referral opportunities. Small Biz Trends suggests that "a 5% growth in customer retention can result in a rise in profits of between 25%-95%." Focus on convenience, quality, and your unique selling point. Showcase the benefits of your services and then go above customer expectations. As a result, you'll increase your revenue and grow your digital firm.

25. Stay On Top Of Digital Marketing Trends

To scale and grow your digital company, stay on top of industry trends like:

  • Virtual & Augmented Reality
  • Artificial Intelligence & Voice Search
  • Personalization & Influencer Marketing
  • Short-Form Videos & Transparency  

Forbes suggests that "voice search is increasing, and over 50% of mobile users in the USA use it every day". Further data from Tech Report reveals that "42% of Americans have viewed a live stream or video". Stay one step ahead of market trends with methods like:

  • Get involved in the industry. 

  • Attend networking events or follow key influencers and trendsetters.
  • Study the stats and keep an eye on the competition.

  • Remain engaged with your customers and track your metrics. 

Then, be open to new perspectives and ideas and ready to pivot your agency when and where it's necessary. 

Why Profit Margins Are Key The Key To Expanding Your Digital Marketing Agency In 2024

Profit margins are key to expanding your digital marketing agency because they show an agency's financial stability. My Codeless Website states that "digital marketing agencies have a net profit of around 6%-12%." A digital marketing agency's profit margin is:

Total profit (revenue minus expenses) divided by revenue
($100,000 - $55,000)÷ $100,000=45% profit margin 

A good gross margin allows you to stay relevant. It ensures you have enough money to invest in new technologies and penetrate new markets. Profit margins directly reflect your agency's overall revenue and long-term success. In 2024, there are four main pricing options for an agency:

  • Hourly pricing: Hourly pricing is when an agency charges clients per hour for their services.
  • Value-based pricing: Value-based pricing focuses on the client's perceived value of the results your agency can provide.
  • Retainer-based pricing: Retainer-based pricing allows a digital marketing firm to charge a fixed monthly amount based on the hours they spend working on a customer's business.
  • Project or deliverable-based pricing: Project or deliverable-based pricing is when a digital marketing company charges a specific price to complete the work and deliver the desired outcome to the client.

But if a digital marketing agency has lower profit margins, it should consider alternative pricing methods like value-based or recurring billing. Be flexible. Provide personalized options for your clients. Next, create a choice a business owner can't refuse. (But ones that still allow your agency to achieve growth). Then, you'll make a profit margin and can grow your digital marketing firm.

How Do You Know When It’s Time To Scale Your Digital Marketing Agency?

You know it's time to scale your digital marketing agency when you have the time, resources, and stamina to grow that includes:

  • A clear plan of action to land new clients and retain your existing customers

  • A team of industry digital experts well-versed in the most profitable marketing services like SEO, email marketing, and content writing

  • Adequate funds to pay for additional staffing, running paid ads, or investing in more technology to support your team.

Of course, when it's time to grow your agency, you will face a more significant workload, elevated stress, and new challenges. The secret is to have a plan. Keep track of spending, revenue, and agency KPIs. Then, you can be sure that your agency is still making money while you scale.

Related Digital Marketing Articles

How Does The Local Lead Generation Business Model Differ From A Digital Marketing Agency?

In 2024, you can grow and scale your digital marketing agency, but you don't own any digital assets. As a digital marketer, you get attention for another business owners' digital entities on the Internet. But if you can't deliver real results or they decide they no longer want to pay for your services. Then, you lose that income stream. Now, you either need to find another paying client or earn less money. 

With the local lead generation business model, you own virtual real estate. Build and rank small websites that get to the top of the SERPs. Because the focus is on the local market, you use local SEO strategies to rank your sites in as little as 6 weeks - 6 months. You own the website, the tracking number, and the leads. Once your sites start producing leads, you can sell those leads to a local contractor for profit margins between 85%-90%.

There are over 41,705 unique zip codes in the USA. You can build in any city, country, or anywhere in the world. There's no ceiling to how many sites you can own. Each site takes about 10-15 hours to build and rank and costs around $500.

However, each site can generate a monthly passive income between $500-$2,000+. Check out this local lead generation program for more information on joining the 7,000+ students making passive income with lead generation coaching.

Follow Me
Ippei Kanehara

$52K per month providing lead generation services to small businesses

Ippei.com is for digital hustlers, industry leaders and online business owners.

His #1 online business recommendation in 2024, is to build your own lead generation business.

Leave a Reply

Your email address will not be published.

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}